Alphons eyes 100 mn jobs through tourism, calls for cut in GST on 5-star hotels

New Delhi: India aims to create 100 million jobs through tourism and attract 40 million foreign tourists annually in the next five years, Union minister K J Alphons said on Monday.

The minister also said that at present, 14.4 million international tourists visit India annually. The annual foreign exchange earning (through tourists' spending) is about Rs 1.56 lakh crore.

"We have set an aim of providing 100 million jobs through the tourism sector and (attracting) 40 million foreign tourists annually into India in the next five years. Today, we are providing about 43 million jobs," the Minister of State for Tourism said at a press conference.

After meeting the CEOs of companies investing in the sector and deliberating upon how to maximise its potential, Alphons asserted he would "strongly recommend" to the finance ministry for a reduction in the GST rate for five-star hotel rooms attracting a tariff of Rs 7,500 and above.

"They (industry) feel the taxes are too high. We would certainly bat for the industry and request the finance ministry to bring down the tax rates so that there will be much better acceptance," the minister said.

Besides, Alphons said, the ministry was in advanced stages of a proposal to provide infrastructure status to the tourism industry for projects up to Rs 50 crore and will soon approach the union Cabinet for its approval on the same.

"With the infrastructure status, possibly the lending rates would come down, states would be able to give land on much better terms to the hotel industry," Alphons pointed out.

Elaborating upon the suggestions that emerged from the day-long deliberations, the minister said the tourism industry has sought a single-window clearance mechanism for approvals. "Even though things have been made much easier at the Centre by the Government of India, they (industry) feel that things are still complicated at the state level. You need about 70 permits for a hotel to be opened, this is outrageous. We need to bring down the number of permits which are required to operate a hotel down to the minimum," he said.

Moreover, Alphons said, the tourism industry feels that it is extremely expensive to set up hotels in India because the land cost is extremely high. "We had proposals from the tourism industry which basically talked about providing land at concessional rate or lease so that one does not have to pay the complete amount upfront. We also agree in the ministry that the cost of land must come down dramatically otherwise they will not be able to set up hotels," said the minister.

Observing that there is a shortage of two lakh rooms across the country in the Rs 2,000 (per day tariff hotels) and below segment, Alphons highlighted the need for massive investment by the sector.

Besides, he said, the government and the industry will work together to ensure the availability of skilled professionals for the hospitality sector. "We have a fairly large number of hospitality institutes run by the ministry itself and we along with the private sector will work on a massive skill development programme," he said.

The minister also conveyed the decision to set up four joint working groups to handle various issues. The working groups will comprise of representatives from the government, tourism industry, Invest India and Department of Industrial Policy and Promotion.

"They (working group) will meet very often and sort out issues, make recommendations to the ministry. We will follow up on these issues meticulously," Alphons said.

He said the tourism sector sought establishment of a national tourism board for constant engagement between the tourism ministry and the industry and a regulatory framework for home stay, etc, adding that the ministry will certainly look into both suggestions.

India currently attracts 1 per cent of global tourists and the government expects to double the numbers over the next five years, Tourism Secretary Rashmi Verma said.

Besides, Verma said the ministry is looking at creating better facilities at the airport so that tourists coming to India get clearance faster and don't have to stand in queues. "We are also setting up facilitation centres at some of the key airports like Delhi, Mumbai, Chennai, etc to facilitate the people who are coming on e-visas," Verma said.

She said the ministry was trying to completely change the mindset and ensure that the country's world heritage sites and the Archaeological Survey of India (ASI) protected monuments have world-class infrastructure facilities.

"We have launched a new scheme called Adopt a Heritage, in which we have offered select ASI monuments and the World Heritage sites for adoption by the industry or the public sector for setting up basic amenities like clean toilets, clean drinking water. Seven sites have already been selected by the public sector and the private sector (for adoption). We are very hopeful that we will succeed in creating world-class facilities at our ASI monuments and world heritage sites in partnership with the private and public sector to provide a much better experience to tourists," Verma said.